YPF, Vaca Muerta should be out of NML’s reach

On the back of confirmation that NML Capital insisted on being granted permission to request information from US oil giant Chevron and other third parties based in the North American country on their knowldege of Argentine assets worldwide, Cabinet Chief Jorge Capitanich accused the vulture funds of attempting to get its hands on the shale oil and gas formation of Vaca Muerta.

“There has been news” that the holdouts “want to embargo Chevron’s (assets) in the Vaca Muerta reserve,” he said, slamming the funds for their “voracity in attempting to seize real assets.”

Marco Schnabl a New York-based lawyer at Skadden, Arps, Slate, Meagher & Flom, told the Herald the Supreme Court’s decision to allow NML to “discover” Argentine assets has nothing to do with actually being able to embargo them.

As both Chevron and YPF are entities separate to the Argentine government, their property is not seizable. The government’s shares in YPF would only be subject to embargos if they were located in the US, which they are not.

In the last 10 years the holdouts have failed in all embargo attempts, and “I doubt the country has any seizable assets abroad,” Schnabl concluded.

In February last year, a California court, where Chevron is based, deemed that NML’s “motion to compel the alter ego discovery concerning YPF from Chevron ... (was) DENIED,” and that its “request to broaden the scope of the subpoena to include YPF... (was) DENIED.”

The hedge fund’s insistence in the shape of a new request to the California court for permission to serve subpoenas on Wednesday last week, grounded on the Supreme Court’s decision in its favour on the ability to discover in general, may be granted, but the assets in question would seemingly not be subject to embargos.